[Added 8-23-2011 by Ord. No. 11-027]
A.
For purposes of this article, the term "insurance" shall include
the purchase of insurance coverages, alternatives to insurance such
as self-insurance programs, as well as participation in a joint self-insurance
fund, risk management program or related services provided by a contracting
unit insurance group, or participation in an insurance fund established
by a local unit pursuant to N.J.S.A. 40A:10-6, or a joint insurance
fund established pursuant to N.J.S.A. 40A:10-36 et seq. The term "insurance
consulting services" shall include all services associated with procuring,
evaluating and administering insurance, including but not limited
to brokerage, risk management or administrative services, and claims
processing or administration services, including such services provided
by a contracting unit insurance group, or an insurance fund established
by a local unit pursuant to N.J.S.A. 40A:10-6, or a joint insurance
fund established pursuant to N.J.S.A. 40A:10-36 et seq.
B.
Prior to entering into any contract to obtain insurance or insurance
consulting services, the City shall secure full and open competition
among insurers and insurance consulting service providers, for the
City's business. The City is hereby authorized, and directed, to use
the competitive contracting process set forth in N.J.S.A. 40A:11-4.3,
40A:11-4.4 and 40A:11-4.5 to secure such competition, except to the
extent this article requires additional measures to better ensure
maximum competition and fairness to all interested parties.
C.
This open competition shall provide that at least 60, but not more
than 120, days prior to the contract commencement date, the City shall
advertise in the newspapers authorized to print legal notices for
the municipality, and in a newspaper circulated in at least five counties
in the state, and on the City's website, a request for proposals to
provide insurance and insurance consulting services. The notice shall
advise the reader that details of the City's insurance requirement
are available from the Municipal Clerk on request and shall include
the phone number of the Clerk.
D.
The request for proposals shall be designed and drafted by the Business
Administrator, Purchasing Agent, or his designee, and shall set forth
such detailed information as may be required for all proposers to
understand and possess equal information concerning the City's insurance
or insurance consulting services needs, including the current terms
of, and fees or premiums paid for, such coverages or services, current
coverages, loss experience and anticipated or desirable needs with
respect to the relevant coverages or services sought. All request
for proposal information, including claims, expense and loss data,
shall be made available to all proposers in both written and electronic
format.
E.
Responses to the request for proposal shall be submitted to the City
at least 30 days prior to the anticipated commencement of the contract.
F.
At no time during the proposal solicitation process shall any official
or employee of the City, or any officer, employee or representative
of any provider of insurance consulting services to the City convey
information, including price, to any potential proposer which could
confer an unfair advantage upon that proposer over any other potential
proposer.
G.
A provider of insurance consulting services to the City shall be
compensated for its services to or on behalf of the City solely by
the City. Compensation shall be set on a fixed fee or hourly basis,
or on such other common and readily comparable basis applicable to
all proposers and set forth in the request for proposal documents,
provided that compensation shall not be determined as a percentage
of premium costs.
H.
No provider of insurance or of insurance consulting services to the
City shall pay to any insurance consulting service provider to the
City, or to any other third party, any form of compensation, including
but not limited to commissions, fees, incentives, bonuses, rebates
or any other thing of value, in consideration of obtaining the City's
insurance or insurance consulting business.
I.
No provider of insurance consulting services to the City shall accept
any form of compensation, including but not limited to commissions,
fees, incentives, bonuses, rebates or any other thing of value, from
any provider of insurance, other insurance service provider, or any
other third party, in consideration of obtaining or servicing the
City's insurance or insurance consulting business.
J.
Any person or entity proposing to provide insurance or insurance
consulting services to the City shall certify in its proposal that
it shall neither pay nor accept any form of compensation, including
but not limited to commissions, fees, incentives, bonuses, rebates
or any other thing of value, in consideration of obtaining or servicing
the City's insurance or insurance consulting business from any party
other than the City.
K.
Any person or entity selected to provide insurance or insurance consulting
services to the City shall certify at least annually and prior to
any renewal of its contract that it has not paid nor accepted any
form of compensation, including but not limited to commissions, fees,
incentives, bonuses, rebates or any other thing of value, in consideration
of obtaining or servicing the City's insurance or insurance consulting
business from any party other than the City.
L.
Any provider of insurance consulting service that assists the City
in soliciting, evaluating, or selecting any provider of insurance
or other insurance consulting services to the City shall disclose
to the City the aggregate compensation, including but not limited
to commissions, fees, incentives, bonuses, rebates or any other thing
of value it has received in each of the prior three years from each
provider of insurance or insurance consulting services solicited or
evaluated by the City. Such disclosure shall be made as soon as practicable,
but in no event later than the date of the evaluation report recommending
an award by the governing body.
M.
The request for proposals for any insurance or insurance consulting
services for the City shall clearly establish the compensation restrictions
and the certification and disclosure requirements established by this
article as mandatory, nonwaivable terms, the violation of which shall
be grounds for:
(1)
Terminating any contract resulting therefrom; and
(2)
Requiring the insurer or insurance service provider to disgorge to
the public entity any compensation, including but not limited to commissions,
fees, incentives, bonuses, rebates or any other thing of value, paid
or received in violation of this article, and commensurate reduction
in premiums to be paid by the public entity for the affected coverage(s)
in the future.
N.
Whenever soliciting quotations for insurance coverage, the Business
Administrator, Purchasing Agent, or his designee, shall obtain at
least three quotations and shall submit the request for proposals
to at least one joint insurance fund, and with respect to health insurance,
to the State Health Benefits Plan, at the same time it is published,
and shall determine if the SHBP and/or joint insurance fund can provide
the same or similar coverages. The evaluation report shall include
an analysis and discussion of the availability, terms and price of
comparable coverage from such joint insurance fund and the SHBP as
part of its award recommendation.
